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2016 (11) TMI 599 - ITAT MUMBAIShort term capital loss - sale of land at Hasteda(Rajasthan) - sham transaction - Held that:- The assessee in its agreement to sale dated 10-03-2008 with Siyaram Exports India Private Limited for purchase of the said land for ₹ 171.50 lacs wherein cash advance of ₹ 10 lacs was only paid by the assessee on 10-03-2008 had an exit clause in the said agreement wherein the assessee could have asked the Siyaram Exports India Private Limited to forfeit advance of ₹ 10 lacs paid by the assessee on 10-03-2008 if the assessee was not able to complete the transaction of purchase of land of its own by 31-12-2008 due to any reasons whatsoever and the loss would have been limited and restricted to ₹ 10 lacs only, but the manner in which the assessee went ahead in January 2009 and entered into two sales deed both dated 16-01-2009 for sale of aforesaid land to Smt Anju Yadav and secondly to Smt Savitri Yadav and Smt. Nirmala Yadav for a meager sum of ₹ 58.40 lacs to self prejudice itself by saddling with an avoidable and unwarranted capital loss of ₹ 114 lacs instead of restricting the said capital loss to ₹ 10 lacs as described above by asking the seller Siyaram Exports India Private Limited to forfeit the advance, clearly defies all logic, rationality and principles of commercial expediency known to the business world which clearly indicates to irresistible as well one and only one conclusion that the whole transaction for purchase and sale of afore-stated land Were accommodating in nature whereby interests of both the purchaser and seller in receiving or giving sale consideration through consideration amounts recorded in books of accounts were duly looked by the assessee wherein seller was accommodated with making of higher payments on record and buyers were accommodated to give lesser price on record for the same parcel of land , and on the touchstone of preponderance of probabilities it reflects that the rest of the money purportedly exchange hands as ‘on-money’ which were not brought to tax on record . The transactions for sale and purchase of land were entered into by the assessee and once the Revenue has doubted the transactions as being not genuine for the reasons as set out above, then the onus shifts back to the assessee to prove by cogent evidences and explanations that the transactions for purchase and sale of land were in fact genuine which the assessee in the instant case failed to do so. Thus, these transactions for purchase and sale are not proved by the assessee to be genuine transactions and are held by us to be sham and colorable devices and short term capital loss of ₹ 114 lacs incurred by the assessee cannot be allowed under the provisions of the Act. - Decided against assessee.
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